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What does brand loyalty look like in 2018?

May 2, 2018

Posted by Becky

Building brand loyalty has, for a long time now, been a central tenet of many marketer’s objectives. While of course acquiring new customers is vital if you want to grow your client base, if these customers turn out to be one-time purchasers, then much of this effort will have been in vain. Ideas such as offering reward schemes, loyalty stamp cards and birthday discounts are all tried and tested methods for keeping your customers happy, but are these conventional methods still the best way to go in 2018? Here are two brands pushing loyalty to the next level and ensuring that customers feel valued and wanted.

Tesco, technology and bringing subdivisions together

Tesco introduced its Clubcard loyalty scheme back in 1995 and it is now estimated to have 17 million users in the UK alone. Giving customers points based on the amount they spend in store, which can then be spent on groceries or as part of the ‘Reward’ scheme on family days out and in restaurants, the scheme has proved popular and enduring.

Yet as technology has developed and spending habits changed as a result, Tesco has had to adapt its loyalty scheme to reflect these new demands. According to a recent article by Marketing Week, Tesco’s introduction of contactless technology to its Clubcard has brought huge benefits to the brand. Tesco’s Dave Lewis told Marketing Week that ‘the relaunch of Clubcard last year with contactless technology had reinvigorated engagement and given the company more capability going forward.’ Lewis also pointed to the cooperation between Clubcard and ‘Pay+, Tesco’s mobile payments app, which now has more than 500,000 users across the Tesco business.’

By incorporating new technologies into its current loyalty offering and tying together different elements of the business, Tesco has kept its loyalty scheme fresh and able to respond to customers’ demands. Lewis believes the cooperation between Clubcard and Pay+ is ‘the only loyalty and payment device in the marketplace,’ which could mark the way forward for brands in the future.

Qiibee and going plastic-less

While many loyalty cards have transformed from flimsy paper stamp cards to more durable plastic cards that can be scanned, these still have to be carried. Writing for The Drum, planning partner of RAPP UK, Simon Cromey, lamented the arduous experience of waiting behind a customer siphoning through a wad of loyalty cards in order to receive their reward. He also observed that, as contactless payment becomes the preferred spending option, the likelihood of carrying a full wallet or purse could well become obsolete in the near future, meaning customers will not want to carry their loyalty cards.

All this means that brands may have to come up with new and innovative ways for customers to use their loyalty schemes, without carrying an ever-growing bundle of plastic in their pockets. This is exactly the problem that qiibee is looking to solve. Far from a household name, qiibee is a platform that helps brands run their loyalty programs on blockchain. Qiibee’s founder and CEO Gabriele Giancola was recently interviewed by Retail Tech News, where he explained that the ‘prototype was launched in late 2016, with a Swiss user base of 100,000, making up approximately 1% of all Swiss internet users.’ Giancola believes the prototype was a huge success, quickly building a large user base and enabling valuable relationships between brands and customers.

One of the biggest benefits Giancola believes that his platform offers is that you don’t need to know the inner workings of blockchain to be able to use qiibee. He explained ‘brands can simply integrate their loyalty programmes and, from there, have immediate access to the multiple customers within the ecosystem.’ Likewise, consumers won’t be aware that they are using blockchain technology, but will simply learn how to navigate the platform like they once did with Facebook and Twitter.

An additional benefit of qiibee that Giancola sees as particularly timely is that it allows brands to address customers’ concerns about data safety. In the wake of the Facebook and Cambridge Analytica scandal, brands could face an increasingly difficult time when it comes to convincing clients to be loyal if they cannot guarantee the data they collect in the process will be safe. By switching to platforms that use blockchain as their foundation, customer data could be decentralised and stored, thereby removing the costs associated with the management and security of data and decreasing the risk of attack and manipulation.

While Tesco and qiibee are just two examples of brands that are seeking to push loyalty schemes forwards by capitalising upon new technologies, many others will soon face similar challenges. By thinking innovatively about how customer concerns and desires can be addressed, marketers can ensure that loyalty schemes remain a valuable part of their arsenal for holding on to customers long-term.